Passionate about IP! Since June 2003 the IPKat has covered copyright, patent, trade mark, info-tech, privacy and confidentiality issues from a mainly UK and European perspective. The team is Eleonora Rosati, Annsley Merelle Ward, Neil J. Wilkof, and Merpel. Nicola Searle is currently on sabbatical. Read, post comments and participate! E-mail the Kats here

The team is joined by GuestKats Mirko Brüß, Rosie Burbidge, Nedim Malovic, Frantzeska Papadopolou, Mathilde Pavis, and Eibhlin Vardy

Friday, 29 November 2013

It's the BBG again! Only hours after updating the IPKat on the current state of its work with the UK's Intellectual Property Office on lookalike packaging, the British Brands Group, in the person of John Noble, has jogged this Kat's memory an prompted him to tell readers all about the World Intellectual Property Organization (WIPO), which has been busying itself by publishing its own important study on brands and their role in the marketplace. The study can be found here. Key points, John tells us, are these:

Companies around the world spend nearly $466 billion annually on branding, more than on R&D and design -- around 25% of company investments in intangible assets in some countries;

Economies such as China and India are investing more in branding than did high-income economies at a comparable stage of their development.

The total value of the top 100 global brands grew by between 19 and 24% between 2008 and 2013, despite the global economic downturn.

IPReg, the curiously-named and non-too-popular body for regulating the professions of patent attorney and trade mark attorney in the United Kingdom, has apparently found yet another way of losing friends: it has just launched a consultation on simplifying and modernising the examination system that will enable aspiring patent attorneys to fulfill at least some of their dreams (click here for details). SOLO IP has already commented hereand here, bu what is needed is some serious responses, on or before the deadline of 5 pm on 17 March 2014 [Merpel, who numbers many practising patent attorneys among her friends, is certain that most of them will respond at around 4.59 pm on 17 March, while a small number will apply for an extension of time].

The organisers of the "From IP to NP" International Conference, held in Tel-Aviv earlier this month and extensively covered on this weblog, have informed the IPKat that the speakers' presentations are now available online at www.aippi.org.il, as well as some of the many pictures taken during the event -- an AIPPI conference hosted by the organisation's Israel group.

Bye-bye Trevor! The farewells to Bird & Bird's (soon to be WilmerHale's) Trevor Cook just keep rolling in and, before the UK IP community's greatest national treasure follows in the footsteps of David Frost and Susan Boyle to "break" America, he has been engaged to enthrall the guests at the Union Dinner Christmas Special on 3 December 2013. If you are interested in attending please contact Steven Wake at dinners@union-gb.com.

"In the run-up to Christmas, all eyes will be on the retail world, and this week is no exception. This festive season, retail giants Next have taken a turn in the spotlight after losing a legal battle with extreme sports photographer Allan Potts, it being found that Next unlawfully used one of his photographs by printing it on a children’s T-shirt without his consent. The photograph in question featured the motocross rider Arran Powley, which Potts had shot at the annual Shropshire County Show in 2010. The image was taken from the internet and modified by replacing the rider’s head with that of a chimpanzee.

Next were not just ‘monkeying’ around, since there was a commercial dimension to this curious head transplant: the retailer reproduced the image on children’s T-shirts, selling them both online and in stores throughout the country. Potts complained, producing a photograph which was time- and date-stamped as evidence that he owned the copyright in the image. This, coupled with the fact that the image had been taken off the internet, was sufficient to persuade Next to accept Potts’ claim and to pay him an undisclosed sum in damages. Next say that the remaining T-shirts will be donated to Oxfam for their charity work abroad.

As time goes on, there seem to be an increasing number of cases involving big retail chains and their apparent abuse of third party IPR, as people are becoming more aware of the rights they hold in their creations. Similarities can be drawn with the recent case of Fenty v Arcadia Group Brands Ltd (t/a Topshop)[discussed by the IPKat here] in which the pop star Rihanna succeeded in her claim for passing off against the retail moguls Topshop, who used her image on a T-shirt without her permission (although Topshop thought they were on solid ground by getting a licence from the photographer to use the picture). These cases should act as a warning to those in the retail industry that ‘slowly slowly catchee monkey’ is the approach to take when wanting to use else’s images on their products and that obtaining images from third party sources like the internet simply won’t do".

JIPLP: now there's a LinkedIn Group too. The Journal of Intellectual Property Law & Practice (JIPLP) has gone one step further in its commitment to growing as a traditional law journal while embracing the possibilities offered by the social media. Already operating its own jiplp weblog and a Twitter account @JIPLP, this Oxford University Press publication now has a LinkedIn Group in which contributors -- and potential contributors -- of articles and case notes can exchange ideas and opinions with readers. If you'd like to be part of this community, please feel free to apply to join it. You don't need to be a subscriber, but you do need to care a great deal about what IP journals are about and as to how better they can serve the interests of readers and authors alike.

Around the weblogs. The IPFinance weblog carries a short note on the launch of the WIPO GREEN database in which the author writes: "This blogger wonders how long it will be before the issues faced by the ICT sector with regard to standard-setting and FRAND licences are endemic in the green technology sector too. A big difference there is that the perceived public interest in getting businesses to use green technologies may have an impact on both the rate of royalties that a court regards as reasonable and the exercise of discretion in granting injunctive relief". This theme may be taken further if enough reader interest is manifested. Elsewhere, on PatLit Stefano Barazza explains the position taken by US professors with regard to patent trolls, and on the MARQUES Class 99 design law blog we learn who might be the informed user of a corkscrew. IP Tango reports that unregistered marks are getting a bit of respect in the Argentine courts, at appellate level at any rate, in a battle for SAN GENARO pasta. Finally, Asim Singh updates us on the latest French site-blocking litigation on the 1709 Blog.

The thoughtful and creative John Walker, a regular correspondent on the 1709 Blog on matters of interest to artists, not least of which is the rights and wrongs of resale royalty rights, has (as he modestly states) written something on "fair use" re scanning library books on Club Troppo ("the suppository of all centrist wisdom since 2002", with the lovely armadillo logo on the right). You can check it out here. For the record, when it comes to fair use, John's in favour.

Taking a project to the next stageis never easy if you need to sleepeighteen hours a day ...

This Kat is always happy to post news of interesting initiatives, but it's a sad truth that most of them come to nothing. Reports, surveys, campaigns, many of which are not only interesting per se but meritorious in their methods and cogent in their conclusions, are prone to evaporate in the face of such obstacles as lack of political appeal, concerted lobbying to contrary effect and natural phenomena such as holidays, illnesses and career changes. Very often the IPKat receives news only of the beginning of a project, and he is left to wonder whatever happened to it. That's why he was so pleased to receive some follow-up information from Katfriend and IP enthusiast John Noble of the British Brands Group (BBG), shedding light on the subsequent history of one of the most absorbing and potentially valuable initiatives he has seen in recent times.

What's this all about? In July of this year the BBG reviewed a major study, "The Impact of Lookalikes: similar packaging and
fast-moving consumer goods", which the UK Intellectual Property
Office (IPO) had commissioned back in 2010 in order to assess the harm caused to consumers and businesses which arose from
competitors mimicking the packaging designs of familiar brands. Since that review [noted by the IPKat here], the BBG has been working with the IPO to reach a common understanding of
what the evidence now tells us about the effect of such packaging. That common
understanding is now available on the BBG's website. This document, Issued by the IPO, identifies the following key findings:

1. There is a lookalike
effect. In essence;

* Consumers
are more likely to make mistaken purchases if the packaging of products is
similar -- and there is strong evidence that consumers in substantial numbers have
made mistakes;

* Consumers'
perceptions of the similarity of the packaging of goods are correlated with an
increased perception of common origin and, to a material degree, there is also
an increased perception of quality.

* The
lookalike effect increases consumers’ propensity to buy a product in similar
packaging.

2. Better sales data
might allow more reliable conclusions to be drawn on the impact of lookalikes
on consumers and businesses, as current data has limitations.

4. The evidence exploring whether German unfair competition law provides a more advantageous regime for tackling lookalikes is inconclusive.

Says John Noble: the evidence in point 1
reinforces the fact that many copies may well be unlawful under UK IP law
(including passing off) and consumer protection law as harmonised under the
Unfair Commercial Practices Directive. The difficulty remains, however, in
bringing a challenge under IP law, with all the problems of presenting evidence
to the Court’s satisfaction, while the Consumer Protection Regulations continue
to go unenforced. The case for Ministers and officials to remedy this
situation, in the interests of consumers, let alone in the interests of
companies that strive to build compelling reputations, is stronger than ever.This Kat is tantalised by the bit about "the evidence exploring whether German unfair competition law provides a more advantageous regime for tackling lookalikes is inconclusive". Do we need more evidence, he wonders, or better evidence? And isn't the real problem when comparing passing off with unfair competition the fact that both have a sort of chilling effect in that they may deter some businesses from look-alike mimicry, but we can only measure both systems by what happens when business do emulate packaging etc, not when they don't?

Thursday, 28 November 2013

Will Secret Santa find pan-Europeanprotection of his identity, gift list anddatabase of donors and recipients ...?

Today the European Commission announcedthat it has now adopted a" proposal for a Directive on the protection of undisclosed know-how and business information (trade secrets)
against their unlawful acquisition, use and disclosure". Unlike some of the Commission's other IP-related proposals, which received more publicity than even important things like the weakness of the Euro-zone and the latest additions [and subtractions, queries Merpel] to Lady Gaga's wardrobe, this proposal has crept up on the IP community almost silently, indeed quite secretly -- even though it wasn't a product of secrecy itself [cf ACTA and the TPP]. There doesn't even seem to be any trace of this proposal from the UK Intellectual Property Office, normally so swiftly off the starting block. Full marks, then, go to the Kat's friends at Hogan Lovells, who have gone so far as to send him the following information:

" ...The Directive will dramatically reform the law of trade secrets across the European Union. It is designed to harmonise the law and how it is enforced across all 28 Member States.
Sarah Turner, partner at Hogan Lovells and co-author of a 2012 study on trade secrets for the Commission ["has this been published?", asks the Kat, who only knows of this 2013 study by Baker & McKenzie], commented:

"Harmonisation of the law on trade secrets has been a long time coming -- the law across Europe as it currently stands is a patchwork and is often inadequate. The proposal is definitely a step in the right direction although there are still some noticeable gaps. For example, trade secret holders often face considerable difficulties in obtaining evidence of misuse and damage[is this the old questiojn of discovery or no discovery, wonders Merpel, or is there more to it than that?]. If the necessary evidence cannot be obtained then legal action may not get off the ground. The current proposal does not introduce procedures to address this issue [In that case it isn't going to change much, is it, Merpel thinkd]. For example, it does not include means to compel defendants to provide information or documents or for a claimant to seek "search and seize" orders without notice to the defendant in order to preserve evidence if there are serious grounds to believe the defendant would otherwise destroy it.

Nonetheless these proposed changes [listed below] are very welcome and appear to support the Commission's general desire to ensure respect for intellectual property and related rights. The differences in trade secrets protection until now have meant that businesses trading in Europe have been in danger of losing significant revenue to their competitors and opportunists. Investors, particularly those interested in innovation and technology, are more willing to invest in countries where they believe that their secrets are adequately protected from misuse [Wait a moment, says Merpel: aren't businesses that don't have trade secrets and who hope to cash in on other people's, more likely to invest in countries where protection of secrets is inadequate?]. Hopefully this attempt to harmonise the law will mean that Europe is in a better place to compete with countries such as the US where trade secrets are recognised as an important business asset and protected by the law accordingly".

[...] The main changes proposed by the draft Directive are:

1. Introduction of a uniform definition of a "trade secret". Currently the term is not defined in most countries' law.

2. A two year limitation period in which to bring claims, running from the date on which the claimant became aware (or should have been aware) of the last fact giving rise to the action. This is a much shorter period than is currently enjoyed in many Member States [is this for the sake of certainty, or to make it more difficult for prospective plaintiffs, or what?].

3. Introduction of a common set of remedies for trade secret misuse including:

• interim and permanent injunctions;

• seizure of suspected infringing goods and their destruction if trade secret misuse is proved; and

• compensatory (but not punitive) damages which reflect the actual loss suffered [why not simply have the same scheme for damages as exists for other rights under the IP Enforcement Directive 2004/48?].

4. Introduction of procedures to preserve the confidentiality of the secrets in dispute during legal proceedings [This Kat is shocked to think that there are still countries in the EU that don't already do this].

The proposed Directive will now enter the normal legislative process involving the European Parliament and the Council before it is adopted.

The Commission's trade secrets page is here
The full text of the proposal (26 pages) is here
Secret Squirrel here
Secret Santa here

LATE NEWS: Sarah Turner has emailed the IPKat with this link to the 2012 study mentioned above. Thanks, Sarah!

Today, the Thanksgiving holiday, a day for giving thanks and sharing a hearty meal with family and friends [not to mention watching American football while dozing off on the couch] will be celebrated in the US. [Merpel licks her lips in anticipation of eating a dinner of roasted turkey, a traditional part of the Thanksgiving meal.] One of the things this Kat is thankful for is the existence of non-profit organizations like Girls on the Run, a US-based after school training course that culminates in a 5K fun run. The program, which this Kat has previously coached, teaches young girls to lead healthy and fulfilling lives through good nutrition and community involvement, and, in addition, helps girls develop the self-confidence needed to defy bullies, become leaders, and pursue their goals and dreams, including (if they desire) careers in traditionally male-dominated industries.

Toy company GoldieBlox, in its quest to encourage girls to explore male-dominated fields like engineering, recently released its latest commercial, which features three young girls singing alternative lyrics to the the Beastie Boys' song Girls, while playing with a Rube Goldberg-style contraption. In light of this Kat's long-running involvement of Girls on the Run and organizations with similar missions, this Kat enjoyed viewing the video, and thought it was quite clever.

Alas, according to The Hollywood Reporter, GoldieBlox's use of the song Girls was not authorized by the Beastie Boys. After the Beastie Boys threatened GoldieBlox with a copyright infringement suit, GoldieBlox filed a declaratory action seeking confirmation from the US District Court for the Northern District of California that the use of the Beastie Boys music in their commercial constitutes fair use as a parody of the original song.

GoldieBlox summarizes its argument in its Complaint:

In the lyrics of the Beastie Boys' song entitled Girls, girls are limited (at best) to household chores, and are presented as useful only to the extent they fulfill the wishes of the male subjects. The GoldieBlox Girls Parody Video takes direct aim at the song both visually and with a revised set of lyrics celebrating the many capabilities of girls. Set to the tune of Girls but with a new recording of the music and new lyrics, girls are heard singing an anthem celebrating their broad set of capabilities -- exactly the opposite of the message of the original. They are also shown engaging in activities far beyond what the Beastie Boys song would permit. GoldieBlox created its parody video with specific goals to make fun of the Beastie Boys song, and to further the company's goal to break down gender stereotypes and to encourage young girls to engage in activities that challenge their intellect, particularly in the fields of science, technology, engineering and math.

A parody imitates a prior work for the purpose of satire or critical comment. Eric Ruder (Beanstalk) explains, "[b]y and large, the courts understand the importance which parody and satire play in our society and are willing to safeguard it, even when it is not merely for social commentary, but also for commercial purposes." However, even if the new work is considered a parody, it may still infringe the copyrights of the prior work unless the new work additionally constitutes fair use.

The factors that must be considered when determining if a work constitutes fair use are set forth in Section 107 of the Copyright Act:

(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes; (2) the nature of the copyrighted work;(3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and(4) the effect of the use upon the potential market for or value of the copyrighted work.

These GoldieBlox girls are notpleased by the Beastie Boys lyrics

In this case, this Kat thinks that the altered song created by GoldieBlox would be considered a parody for the reasons put forth by GoldieBlox in its Complaint. The thornier question for the court will be whether GoldieBlox's parody is a valid example of fair use. Considering that the video is, at its heart, a video of a commercial nature, the court will likely take a narrower view of the factors in its analysis.

However, in 1994, the US Supreme Court decided a similar case, Campbell v. Acuff-Rose Music, Inc., which this Kat thinks provides useful insights into how the US District Court for the Northern District of California may analyze this case. In Campbell, Acuff-Rose Music, the publisher of Roy Orbison's classic hit Oh, Pretty Woman, claimed that the song Pretty Woman by rap group 2 Live Crew and its lead vocalist, Luther Campbell, infringed Acuff-Rose's copyright in Oh, Pretty Woman.

As to factor one, the commercial nature of the video weighs against GoldieBlox, but the Supreme Court made clear in Campbell that this is merely one factor for consideration that does not necessarily bear more weight than any of the other factors. The second factor was held not to hold much weight in respect of the Campbell analysis, and it will likely not be a prevailing factor in GoldieBlox's action either.

The District Court's analysis of factors three and four will probably be the most influential in the outcome. This Kat thinks the third factor weighs more favorably for the Beastie Boys because the GoldieBlox version of the song uses the same musical composition from a large portion of the full length Beastie Boys song. On the other hand, a musical parody of a song must necessarily leverage more substantial portions of the original copyrighted work than is required for parodies expressed in other media.

Finally, in considering the fourth factor, the Supreme Court determined in Campbell that "[t]he cognizable harm is market substitution, not any harm from criticism. As to parody pure and simple, it is unlikely that the work will act as a substitute for the original, since the two works usually serve different market functions." The same can be said for GoldieBlox's parody of Girls - the two works are meant to appeal to two different audiences and serve very different market functions. Thus, this factor would seem to favor GoldieBlox.

Whether the District Court for the Northern District of California will ultimately consider the GoldieBlox video to be a parody that is protected as fair use or an infringement of the Beastie Boys' copyright remains to be seen. Watch this space for updates.

In the meantime, this Kat wishes a happy holiday to all those who celebrate Thanksgiving - and Chanukah, which overlaps with Thanksgiving this year.

This Kat has been out of blogging contact for the better part of two weeks, cavorting (professionally, that is), first in Miami Beach and then in Geneva. He can confirm that Miami Beach is short of snow and mountains, while Geneva is short of palm trees and sand. Back on terra firma, this Kat has had a chance to reflect on a topic of increasing interest to him: the nature of the patent narrative. By “narrative” I mean the broadstroke themes that dominate public discourse about patents. Being part of the patent narrative does not mean that the issue is necessarily central to the patent system—maybe yes, maybe no. These issues may be interrelated, one with the other, maybe yes, maybe no.

What is common to all of them is that they enjoy the public limelight and that they are widespread in the mainline media and social media, i.e., they have acquired patent “celebrity” status. Against this backdrop, it seems to this Kat that the current patent narrative consists of four principal themes. The first is the “problem” of non-practising entities and so-called patent trolls. The second is the claimed “decline” in patent quality. The third is the aggregation and accumulation of large patent portfolios in the hands of a small number of multi-national entities. The fourth is the increasing refocusing of patents as a commercial asset rather than as an enforceable legal right.

But lurking in the shadows of these celebrity topics are substantial subjects that seldom seem to make it into the pantheon of the popular patent narrative, despite their arguable importance. One such topic was suggested in connection with a recent podcast that this Kat heard this week. In short, a serially successful entrepreneur was discussing his most recent social media venture, a platform for truly mass interactive television. He described the process of overcoming various technological challenges to develop the platform. He was then asked about the role of patents in protecting his platform. He was quick to answer—patents played no role. He acknowledged that patents might play some “defensive” role for large companies (perhaps alluding to the various mega-patent portfolios that have been acquired during the last several years). But for him, what mattered was getting the technology right. Was he worried that competitors might simply imitate his technology? Not at all, was his response, to develop it was too complex and time-consuming to pose a real threat of competition. For this entrepreneur, innovation was all about the cumulative know-how embodied in creating state-of-the-art technology; patents are perceived as having little or no relevance.

Consider the thrust of these comments. Much effort and many resources are devoted to enabling small and medium enterprises, the so-called SMEs, to take greater advantage of the patent system. What underlies these efforts is the belief that patents are a sine qua non of innovation and development, and that large companies have an unfair advantage in exploiting the patent system, whether due to costs or other “burdens” of the patent system. As a result, it is argued, there is patent divide between large companies and SMEs and the goal of enlightened patent policy is to bridge this divide and bring SMEs more into the patent fold.

But the anecdotal comments described above suggest a quite different narrative, according to which SMEs (and start-ups) may eschew patent protection for the simple reason that it provides less benefit than simply protecting one’s technology as a form of know-how. Create a better platform, get it to market and develop a powerful brand, and not accumulating a patent portfolio, is the preferred road to success. If this be true, then the efforts and resources expended to bring patents to the SMEs may simply be misplaced. The more correct narrative should focus on how to enable the development of quality technology in the form know-how/trade secrets to be leveraged by effective marketing and branding rather to seek to impose the patent system on such companies. Inasmuch as encouraging start-up activity is a major priority in most developed countries, recasting the narrative in this way may be no less important for innovation and technological development than the patent themes mentioned above. No less important, indeed, but whether it will become part of the public narrative remains an open question.

Communication to the public: yes or no? Merpel can't say without investigating in person

There are times when even a copyright-loving Kat may miss a copyright
case, not necessarily because she is having fun relaxing at a spa, as is
instead the background at the origin of another reference to the Court
of Justice of the European Union (CJEU). So, katpat to the one and only
IPKat Jeremy for telling everything about Case C-351/12Ochranný svaz autorský pro práva k
dílům hudebním, o.s. (OSA) v Léčebné lázně Mariánské Lázně a. s.[more handily:OSA], a reference for a preliminary ruling
from the Krajský soud v Plzni (Czech
Republic) concerning the ever-exciting right of communication to the public,
effect of badly-implemented directives, and collective rights management. Most importantly,
this is a case in relation to which Advocate General Eleanor Sharpston
delivered herOpinion on 14 November
last. But what is this mysterious (at least to this Kat) reference all about?

As neatly summarised by the AG, radio and TV
sets in the bedrooms of a residential[and very
nice:see here]health spa establishment in the Czech Republic
give access to broadcast works[Merpel
suspects that this Czech spa may not be the only one].

UnderDirective 2001/29, holders of copyright in such
works have the exclusive right to authorise their communication to the public
pursuant to Article 3(1) of this directive and may claim fees for doing
so.

OSA, a copyright collecting society with
exclusive rights to enter into licence agreements and collect fees on behalf of
authors of musical works in the Czech Republic, claims fees for such
communication to the public by the establishment in question.

The establishment objects both that the service
in question is not communication to the public and that the Czech collecting
society’s territorial monopoly infringes the establishment’s right, derived
from EU provisions on freedom to provide services, to enter into a licence
agreement with a collecting society in another Member State – a problem which,
it claims, is exacerbated by the Czech society’s abuse of its national dominant
position by charging excessive fees.

The Regional Court of Pilsen wishes to know:

1) whether the service in question
constitutes communication to the public within the meaning of Directive
2001/29;

2) whether the relevant provisions of
that directive are sufficiently precise and unconditional to be relied upon in
a dispute between individuals; and

3) whether EU law precludes a Member
State from according a single collecting society exclusive rights within its
territory.

According to the AG, this question has an easy
answer: a spa establishment resembles more a hotel room than a dentist
waiting room:

"Spa establishments typically have a broader and less determinate
clientele than dentists (and counsel for the Spa described it at the hearing as
possibly the largest such establishment in Europe); the availability of access
to television and radio broadcasts in bedrooms may well influence a patient’s
choice of establishment; and in that regard the availability of choice is
likely to be significant.

Moreover, the television and radio sets are in
residents’ bedrooms. They are used in the context of enjoyment of the
accommodation facilities offered by the Spa, not of its health care treatment.
Such a situation is clearly analogous to that of the hotel guests in SGAE."

From these considerations descends thatthe
provision of television and radio sets in bedrooms in a spa establishment,
together with the relevant signal enabling broadcasts to be heard or viewed,
must fall within the concept of communication to the public in Article 3(1) of
Directive 2001/29.

Of course, Article(5)(2)(e)[exception
or limitation in favour of social institutions pursuing non-commercial
purposes, such as hospitals or prisons]would
not apply in that this provision is concerned with the right of reproduction,
nor would Article 5(3)(b) [exception or limitation for the
benefit of people with a disability] of the directive. The latter, in fact, concerns communications to the
public which are directly related to the disability and are of a
non-commercial nature, whilein this case suggests there is no relationship between
the availability of television and radio sets in spa bedrooms and any specific
disability from which patients may suffer.

Still thinking:It will take an extra week (minimum)at the spa before Merpel can reach a conclusion

2) Are the relevant provisions of Directive
2001/29 sufficiently unconditional and precise for collecting societies to rely
on them before national courts if a certain Member State has failed to
implement it correctly?

According to the AG, the answer must be in the affirmative:

"[W]hen national courts apply
domestic law, they are bound to interpret it, so far as possible, in the light
of the wording and purpose of any relevant directive, in order to achieve the
result sought by the directive. That obligation is inherent in the system of the
Treaty on the Functioning of the European Union. It enables those courts to
ensure the full effectiveness of EU law when they determine disputes within
their jurisdiction ... If a Member State has failed to implement Directive
2001/29 correctly, a national court hearing a claim for copyright fees against
an individual must interpret its domestic law, so far as possible, in the light
of the wording and purpose of that directive, in order to achieve the result
sought by it."

3) Can a Member State reserve the exercise of
collective copyright management to a single collecting society?

Again, the answer should be in the affirmative
according to AG Sharpston. Although this creates a territorial monopoly
which deprives recipients of services of the freedom to choose a collecting
society in another Member State, this is neither a violation of the
freedom to provide services nor tantamount to a violation of Article 102 TFEU[abuse of a dominant position].

This Kat wonders whether the conclusion of the AG
might be have been influenced to some extent by the recent decision of the
General Court[not cited in the Opinion] in Case
T-422/08CISAC(here), in which it was recalled – among other things – that the structures
used for traditional forms collective rights management and related national
territorial limitations are not usually considered by the Commission to
constitute an infringement of competition rules.

Wednesday, 27 November 2013

"Wonderful!" is an overworked word in many people's vocabulary, though it's unusual to hear it deployed nowadays in contexts that indicate fullness of wonder. One object of wonder, for this Kat at any rate, is why people ever want to pay money in order to watch a movie that makes them cry. This leads him to take a keen interest in the goings-on on the other side of the Atlantic which Katfriend and guest contributor Rebecca Gulbul alludes to below. Rebecca writes:

At the
end of last week, it was revealedto a no doubt excited public that a sequel to one of the all-time great Christmas classic movies,It’s a Wonderful Life,[listed at number 6 in the list of greatest tear-jerkers] was to be made by Star Partners and Hummingbird Productions. The 1946 film, produced by
Paramount Pictures and directed by Frank Capra, narrates the Mr George Bailey who falls
into the depths of despair about the state of his life and wishes that he had never been
born. He is thereafter saved by an angel who shows him the positive impact he
has had on the people of his town.

The storyline
of the proposed sequel will be based on Charles Dickens’ story: A Christmas Carol. The main protagonist
will be Mr Bailey’s grandson-- an unlikeable character (similar to Ebenezer Scrooge, left) who
would be shown by an angel how much better life would have been had he not been
born. Karolyn Grimes -- who already
featured in the first film as Zuzu, the daughter of Mr Bailey -- is to play the
role of the angel. She will interpret an older version of her character, who
has now become an angel.

Paramount Pictures has said that it will object to any sequel to the film, maintaining that it.
They owned the rights to the film and that any attempt at a
sequel would infringe those rights unless a licence for it was granted -- something that it's not prepared to do.
Even if Paramount owns the rights, there can only be infringement if a
substantial amount of the original work is copied. Does the sequel therefore
attempt to take too many elements from the 1946 film? It might still be too soon
to determine that at the moment given the limited amount of information we have
and since the sequence has not yet been produced, but the current situation is
explained below.

From an initial observation, the new storyline is
different from the first film, as it will be based on A Christmas Carol. It is therefore neither a remake of the first
film, nor does it appear substantially to rely on the previous plot. The main
protagonist of the sequel will be George Bailey’s grandson, a character who was not
part of the first film.

Little Zuzu: no visible wingsback in 1946

Little Zuzu, whom we met in the first film and who
played a minimal part, has now been incarnated into an angel (we don’t know yet
if she has earned her wings!) in order to show her nephew, the revised, upgraded version of Scrooge, how much better the world would have been had he not been born (a neat twist
on the theme of Mr Bailey’s original situation). There does not seem to be any substantial resemblance
to the original plot. Further, although Zuzu's character has been inspired from
the 1946 film, the role she is expected to play now is substantially different.

It would appear therefore that the extent to which copyright law can be invoked in order to prevent this sequel is doubtful. Copyright is only concerned about protecting the
expression of ideas, while it is axiomatic ideas on their own have long been held
non-protectable. It appears so far that the sequel only pertains to be inspired by the first
film without attempting to copy a substantial part of the story.

Tom Capra, the son of the deceased director Frank
Capra told Associated Press that he does not support a sequel and believes
that his father would not either. However,
this seems to relate more to a moral right issue rather than a copyright one
and the Visual Artists Rights Act 1990 in the US only provides moral rights protection to certain
categories of works which does not include films.

It will be great to see how the story unfolds. If the sequel does go ahead, its release is expected in time for Christmas 2015.

This Kat feels that it would be improbable, given the nature of the new storyline, to run the sequel with a title anything like It's a Wonderful Life. What more appropriate title might be conjured up, he ponders."Mr Wonderful" here by Peggy Lee, here by Fleetwood Mac"It's a Wonderful World" here

Merpel, like the IPKat, is always happy to dispense unsolicited advice -- but it's even nicer when someone asks her opinion. That's why she was so happy to receive earlier this afternoon the following message from a representative of Her Britannic Majesty's Government that read as follows:

"Doubtless
you will have read the Scottish referendum White Paper from cover to
cover [Indeed, says Merpel, I make it a point of reading little else]. If not you can find it at https://s3-eu-west-1.amazonaws.com/ref-whitepaper/scotland+future+white+paper+november+2013.pdf.
XY here [at the Intellectual Property Office] is looking at the claims on IP
summarised below for those who couldn’t download the 700 odd pages [they're not all odd, says Merpel, who checked every one of them and discovered that round about half of them were even]:

•
Independence
will allow Scotland to offer “simpler and cheaper, more business-friendly model
than the current UK system, which is bureaucratic and expensive, especially for
small firms. The UK is one of the few EU countries which does not offer a
scheme which covers the basics of protection. Scotland could follow, for
example the German model which protects technical innovations.” [This sound like fun: the McGebrauchsmuster]

•
Scotland
has dispute resolution expertise

•
Scotland
will amend immigration rules to enable the recruitment of international
research talent and students

•
There’s
then a bit on how the Scottish Govt is building relationships with the likes of
Walt Disney [no mean achievement: the man died in 1966]

Page
398

“Q66
Will intellectual property rights be protected?

Yes.
Intellectual property will continue to be protected. As an EU member
state [not so fast: will Scotland meet the admission criteria?], Scotland will meet European regulations and directives on IP rights
protection, as well as international patent and trade mark protections.

Q67 Will independence offer improved intellectual
property services?

Yes.
Independence will allow Scotland to offer a simpler, cheaper and more
business-friendly business model than the current UK one which is seen as
bureaucratic and expensive, especially for small firms. The UK is one of
very few EU countries which does not offer a “second tier” , or “utility”
protection scheme which covers the basics of IP protection and is cheaper and
quicker to access. Scotland could follow for example the German utility
model which is more a protection of technical innovations.”

If you
have a moment, I’d be grateful for your thoughts on what’s there to feed into
our thinking/discussions".

This debate may rumble on for a long time. Meanwhile, readers are invited to air their thoughts.

Cats make excellent trainers. In the picture above, Bubbles teaches a human howto hold a hoop steady with just one hand so that she can jump through it

Reality asserts itself. This Kat has received from the UPC Training Conference Team at the Hungarian Intellectual Property Office (HIPO), the following missive:

Please be kindly informed that the Hungarian Ministry of Public Administration and Justice and the Hungarian Intellectual Property Office, in cooperation with the European Patent Office, jointly organise a conference on the training of the Unified Patent Court’s judges.

The conference will take place in conjunction with the inauguration of the building of the Training Centre in Budapest.

When?
13-14 March 2014

Please save these dates in your calendar of next year.
We will keep you updated on the programme and further details of the event.

Naturally this Kat, with some four decades of experience in the field of intellectual property training (including the training of judges), will be delighted to make the pages of this weblog available to the three substantial and celebrated bureaucracies which between them bear the burden of turning good and decent humans into Unified Patent Court (UPC) judges. Merpel goes even further, setting out suggestions as to some of the essential elements of any training programme for the UPC judiciary -- though she doubts that any people who spend year after year learning the law and decades practising their skills will be turned into fully-functioning UPC judges in just two days, particularly in view of the high quality of the Hungarian hospitality she has enjoyed in the past.

Merpel recommends at least the following modules:

* interpretation of claims [particularly travel and expenses claims]
* interim procedures [since the time-lag between appointment as a UPC judge and getting a chance to do some judging may be quite extensive]

* stays [the hotels in Munich have much to comment them, apparently, but Paris is more fun ...]

Tuesday, 26 November 2013

Much ado about ... not so much? SAS Institute Inc v World Programming Ltd[2013] EWCA Civ 1482 is a Court of Appeal, England and Wales, ruling from last week on an action that seems to have been going on for rather a long time -- which indeed it has. This copyright infringement action, involving computer software and a manual used (or abused) by the defendant licensee, commenced in September 2009. The 12-day trial led to a judgment in July 2010 in which Mr Justice Arnold referred at least nine questions (more if you include subquestions) to the Court of Justice of the European Union (CJEU) for a preliminary ruling. The Advocate General's Opinion was published in November 2011. Once in receipt of the CJEU's ruling in Case C-406/10 at the beginning of May 2012, the parties consumed another two days arguing the toss before Arnold J gave judgment in January 2013 which was almost entirely in favour of the defendant.

To recap: SAS developed its own SAS software programs, in the SAS language, for data processing and analysis, together with technical manuals. World Programming ('WP'), a competitor, predicted that there would be considerable market demand for competing software which could execute application programs written in the SAS language and accordingly penned its own software ('WPS') for that purpose. WP sought to emulate much of the functionality of the component's of the SAS programs in order to ensure that its applications worked the same way whether they ran on WPS and on SAS components. SAS sued for infringement of its copyright in pretty well everything it could think of.

After a thorough review of the law and the facts (and it's a brave man who says Arnold J is anything but thorough), Arnold J dismissed all SAS's copyright infringement claims except those relating to WP's reproduction of the SAS manuals through a process elegantly described as "linguistic reproduction".

While WP was a competitor of SAS, it was also curiously a licensee. This is because SAS developed a "learning edition" of its software in order to educate users as to its full functionality. The use of this learning edition governed by a contractual licence. After holding that WP had breached the licence by using the software for "non-production" purposes and by allowing use by employees who had not "clicked through" the licence and therefore fell outside the definition of "customer", Arnold J nonetheless referred a question to the CJEU as to whether WP's use of that edition was permitted by Article 5(3) of the Software Directive. By that provision

"The person having a right to use a copy of a computer
program shall be entitled, without the authorisation of the right­
holder, to observe, study or test the functioning of the program
in order to determine the ideas and principles which underlie
any element of the program if he does so while performing any
of the acts of loading, displaying, running, transmitting or
storing the program which he is entitled to do".

Said the CJEU, copyright in a computer program could not be infringed where, as here, the lawful acquirer of the licence did not have access to the source code but merely studied, observed or tested the program in order to reproduce its functionality in a second program. Arnold J accordingly held that, while use of the learning edition was restricted to specific employees who had entered into licence agreements, WP had still lawfully acquired the right to use the program. On that basis, Article 5(3) invalidated any term of the licence that restricted the manner in which that right could be enjoyed.

SAS appealed, arguing that WP had used its manuals as a technical specification and copied a substantial part of them, that it also infringed copyright in thems by reproducing a substantial part of them in its own WPS manual and that WP infringed SAS's copyright in the learning edition and was in breach of contract by repeatedly using it outside the scope of the applicable licence to obtain information about the SAS system and to check that the operations of WPS precisely replicated those of the SAS components.

The Court of Appeal (Lord Justice Lewison, who delivered the judgment, together with Lords Justices Tomlinson and Vos) dismissed the appeal in its entirety. Why?

* In deciding whether the reproduction of elements described in the SAS manuals was a reproduction of the expression of the intellectual creation of the author of the user manual (this being the CJEU's Infopaq formulation), what was relevant was not the intellectual creation, but the expression of the intellectual creation of the author of the manual.

* The functionality of a computer program was not a form of expression (which was capable of being protected by copyright), but was more like an idea (which wasn't).

* For an infringement of copyright to exist, the allegedly infringing work had to represent the claimant's work in some real sense.

* It would be contrary to the policy of not only the Software Directive but also the InfoSoc Directive if SAS could secure copyright protection for the functionality of its program indirectly via its manual, which simply explained that functionality.

* Since the CJEU had unequivocally held that the fact that WP had used the learning edition for a purpose which was not permitted by the terms of the licence did not mean that it could not rely on Article 5(3) of the Software Directive, a contractual restriction was invalid to the extent that it prohibited the observation, study or testing of the functioning of the program in order to determine the ideas and principles underlying it.

* It was possible for the "customer" entering into the licence agreement to be a company and, being a licensed company, WP was entitled to use the learning edition and there was no restriction on the number of employees whom WP might authorise to observe, study and test the program.

This Kat notes the Court's reiteration at [108] of a rule of contractual construction that seems to him to have fallen a little out of favour in these days of bending over backwards to accommodate the real or imagined intention of the parties to a contract -- he's talking of the contra proferentem rule. As the Court said (and incidentally disagreeing with Arnold J who reached his conclusions without feeling the need to invoke it):

"... one cannot forget that the licence agreement is offered on a take-it-or-leave-it basis. The purchaser has only two choices: click on the "Yes" button or click on the "No" button. There is no room for negotiation. If there were any doubt about the meaning of the licence at this stage, in my judgment the application of the contra proferentem principle would tip the balance in WPL's favour".

In the wrong blog ...?

Merpel, who nurses a deep and longstanding affection for Latin, is thrilled to see that the courts are still allowed to say "contra preferentem", even though so many Latin terms were excised from English legal terminology in the wake of the Woolf reforms. As to this lengthy and costly litigation, she has only this to say, quoting the sage words of Horace:

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